TaxRates

If tax rates rise -- and experts say they will -- a way to grow your money tax-free starts looking mighty good. Meet the Roth IRA.

Saving for retirement isn't just a smart move for the long run. It can also cut your current taxes. But what if reducing your taxes now is the wrong strategy? For many workers, a smarter option is a retirement plan that eliminates your tax bill down the road: a Roth 401(k).

Amid all the chatter about Mitt Romney's high income and low taxes, many have wondered why more Americans don't take advantage of those attractive capital gains rates. The answer is that most people can't -- at least not on a level large enough to make a difference in their finances.

A lot of tax talk focuses on tax brackets. But in order to get the full picture of what you hand over to Uncle Sam, you need to consider not your bracket, but your effective tax rate -- and those are two very different numbers.

Mitt Romney paid a lower tax rate on his $21.6 million income in 2010 than the average U.S. family. It's no secret how: He made his money from investments, not wages. But even people who favor low capital gains taxes might not approve if they understood more about a neat little income category he benefited from called "carried interest."

Now that President Obama has signed a sweeping tax bill into law, many Americans want to know how they'll be affected. The compromise deal extends Bush-era tax reductions on income, capital gains and dividends through 2012. But there were also some changes.

By law, the thresholds for the marginal federal income tax brackets must change each year to keep pace with inflation. For 2009, those brackets are as follows: Taxpayers Filing as Single: 10% on taxable income between $0 and $8,350 15% on taxable income between $8,350 and $33,950; plus...